Exploring NFT-powered play-to-earn games

Gaming is without doubt one of the most popular hobbies in the world. But these days, it’s much more than just a pastime - it offers a way of earning a living, too.

The terms “play-to-earn” and “GameFi" have been cropping up all over the place recently. While they are often used interchangeably, GameFi technically describes the finacialisation of blockchain-based video games, whereas play-to-earn is a gaming model that allows players to earn digital assets for their in-game efforts.

Unlike traditional games, in which you can earn in-game assets that only hold value within a particular game, GameFi lets you earn assets that are valuable in the real-world, like crypto and NFTs.

It isn’t hard to see the appeal of earning money from something you probably already do for enjoyment. But what part do NFTs play in all this?

Where do NFTs come in?

GameFi leverages the immutability of blockchain technology by producing in-game rewards that are provably unique and transferable. These rewards are typically crypto tokens, which can be exchanged for fiat money, or NFTs, which can be sold on various marketplaces.

In our previous blog about blockchain games, we discussed the rise of NFT-based play-to-earn metaverse game, Axie Infinity. Released in 2018 and now the highest-grossing NFT game on the market, Axie Infinity is a prime example of the play-to-earn model.

Built on Ethereum, the game allows players to trade cute, colourful monsters known as “Axies” and pit them against each other in battles. The key to earning money in Axie Infinity is the in-game digital currency known as Smooth Love Potions, or SLP. SLP enables players to breed Axies, which can then fight other bot monsters or players to earn even more SLP rewards, or be sold on the Axie Infinity Marketplace.

Whereas in regular games, your in-game items are ultimately owned by the company that created the game, play-to-earn games allow players to truly own any unique assets they earn or buy, in the form of NFTs. These can then be traded for fiat currency on NFT marketplaces outside the game, since their scarcity creates real-world value.

Gaming for fun, not money

While games like Axie Infinity were designed to follow the play-to-earn model, the rest of the gaming industry seems somewhat slower to embrace NFTs. Despite big names announcing that NFTs are an inevitable part of the future of gaming, the players themselves are reportedly showing some resistance.

An example of this is developer GSC Game World backtracking on its decision to incorporate NFTs into STALKER 2 last December, due to overwhelming backlash from its fans.

So, do NFTs only belong in the world of DeFi, or will they eventually infiltrate the entire gaming industry? And could it be said that true gamers want to play for fun, not money?

Let us know your thoughts below!

Disclaimer: this blog is for educational purposes only and should not be taken as financial advice.